Red State Rag

My state, Tennessee, has the fourth most regressive tax structure in America. That's the report of the 2009 edition of Who Pays, the annual analysis by the Washington-based Institute on Taxation and Ecomonic Policy of the distribution of state and local taxes across income groups in different states.

The poorest 20 percent of people in Tennessee, those families making less than $17,000 a year, paid 11.7 percent of their income to state and local taxes, compared to 3.1 percent of income paid by the richest 1 percent of families in the state—families making $414,000 or more a year. This means that the share paid by people making less than $17,000 was nearly four times greater that that paid by people making more than $414,000. In Tennessee the middle 60 percent of the population paid 7.6 percent of income in state and local taxes, more than twice the rate paid by the richest of the Tennessee rich.

As you may have guessed from these numbers, there is no income tax, progressive or otherwise, in Tennessee. Sales taxes make up most, about 70 percent, of total revenues. The state sales tax on food is 5.5 percent; obviously, such necessities are going to take a much bigger bite out of a $17,000 household budget than a $414,000 one.

Clearly this is obscene.

The fair thing to do would be to lower the sales tax, drop the tax on food, and add a progressive state income tax. During the 25 years I’ve lived here, there has been an almost continuous argument over doing just that. Generally the argument doesn’t get too far beyond the word TAX. At that point we are immediately get in tea party territory—we’re angry, we’re not going to take it anymore, don’t tread on me with your big government European socialism—and the discussion is over.

Of course, what this tea party amounts to is 80 percent of the population shoveling their early retirement and their kids’ college education and the vacation in Florida and their daily bread into the harbor, while a tiny group of people making more $414,000 stand on the dock and laugh at them.

If it were just the bottom 20 percent of the population getting screwed here, it would be easier to understand. As we’ve seen in the health care debate, compassion is not a significant political motivator. Nobody above the poverty level, middle class or rich, really cares about the people on the bottom who get shafted the most. We don’t care if they die with no health coverage, we don’t care if they pay taxes that could be going to food and rent. They are the unwashed “them” and they don’t vote and they don’t count.

More interesting is the 60 percent in the middle who are essentially shafting themselves. I live next door to people who get up every morning and start thinking of new ways to shoot themselves in the foot. More often than not these schemes involve shooting me in my feet as well. This is why I’m interested in how these people think.

But I would suggest that what goes on in these people’s brains should be just as important to those who don’t live next door to them. The past year has amply demonstrated that even when the red states lose an election, they can still call the tune for everybody in the country. The majority does not make policy; who makes policy is the guy who casts vote number 60 to cut off debate in the Senate. He can shoot you in the foot, whether you live in Knoxville or Boston or San Francisco.

So, yes, to protect yourself, you first build a majority on your side, and then you build a supermajority.

When was the last durable supermajority? Around 1936.

What do we do while we wait for 1936 to come around again? We make compromises. We sit down with our neighbors and try to talk them down from their ingrained hysteria. We listen to what they have to say. We make the best deal possible, we keep plugging, we do pretty much what Obama is doing right now.